Seeds Global Economic Outlook 2025

Global Overview

At Seeds, we believe the US economy is likely to see a serious potential deceleration among major developed countries. According to ICG Research, "it is expected for growth to slow between 0% to 0.5%, with potentially a quarter or two of negative growth depending to what degree announced tariffs are moderated and the degree to which the Fed and Treasury are willing to intervene to stabilize markets upon necessity."

On the other hand, growth in Europe and the UK is slow but positive, and the global economic environment should remain supportive for most Asian economies. Most of Latin America and emerging economies are going to gradually substitute American goods by moving towards China. Therefore, it is likely that China goods exports to non-US countries will escalate, and prices will come down as many Chinese companies are forced to divert product away from the US market. While this may have a negative impact on domestic competitors, it will also likely help push goods inflation down and allow central banks to cut interest rates.

On balance, we think the ongoing tariff war will dampen Asia-Pacific growth but not substantially damage it. All affected countries by the US tariffs hit will try to focus more on specific gaps and try to either produce locally or divert towards other producing economies.

Net Trade by Country (Balance of Payments)

Economic Policy Uncertainty Index

The GCC

In the GCC, investments in non-oil sectors have increased significantly, particularly in tourism, real estate and manufacturing sectors, driving growth from 2024 onwards. Gains in this sector helped balance the impact of OPEC+ oil production cuts, which significantly affected hydrocarbon output. In figures, non-oil GDP growth averaged 3.7%, highly above the overall economic growth rate of 1.8%. In 2025, it is expected for this growth to continue and for the economy to be more resilient to oil revenue declines over the years.

The World Uncertainty Index for Q4 2024

Country	WUI Value (Q4 2024)	Source
Saudi Arabia	0.06726	FRED - WUISAU
United States	0.10350	FRED - WUIMAUSA
Germany	0.62400	FRED - WUIDEU
China	0.06444	FRED - WUICHN

Higher Index Values Indicate Greater Uncertainty.

That being said, the emerging economies are much more certain than the developed ones.

In conclusion, while the global economy faces mixed growth prospects, the US is likely to see a slowdown, and Asia is adapting to shifting trade dynamics. The GCC's non-oil sector growth provides a buffer against oil price volatility, ensuring stronger resilience moving forward. Overall, these trends highlight the importance of diversification and adaptation in navigating future economic challenges.